Maybe, maybe not! The Xinhua News Agency and Beijing News have both reported that Google is operating under the internet content provider license granted to Ganji.com. The paper suggests that this may be a technical violation of Chinese law stipulating that foreign companies may not provide Internet content without an ICP license.
However, analysts have stated that it is unlikely that this will result in a declaration of illegal activity by Google. Essentially, foreign internet companies operate under contracts with Chinese companies on a routine basis, with the local company listed as the license owner. Google’s search page does indeed display an indicator of an ICP license number, and has since at least January 25th, according to Danny Sullivan of Search Engine Watch.
It seems unlikely that Google did not investigate the legality of their behavior thoroughly – and it also seems unlikely that the Chinese government will take an action which may require other internet companies to pull out of the Chinese market.